The anti-alcohol group says raising the current alcohol excise tax could contribute $4.66 billion more in state revenue over the next 10 years while reducing youth consumption, alcohol-related violence, disease, and traffic fatalities.
“We are writing out of serious concern regarding two issues confronting California: the state’s estimated $22.5 billion budget deficit (Walters, 2023), and the nearly 20,000 annual deaths from alcohol-related causes estimated by the state’s Department of Public Health (CADPH; Jimenez, Demeter & Pinsker, 2023),” stated Cruz Avila, Executive Director/CEO of Alcohol Justice in his letter. “We strCongly urge you to consider raising the state’s alcohol excise taxes in the May Budget Revision – a potential win/win that would raise revenue and curb mortality.”
The last alcohol tax increase in California was in 1992 and just a penny per glass of wine and two cents per can of beer and shot of spirits. Since then, rising inflation has led to a 52% percent decrease in state alcohol tax revenue—the tax now brings back less than 50 cents on the dollar compared its original value. Moreover, the Centers for Disease Control and Prevention estimate California state and local government costs for alcohol-related problems to be $14.47 billion annually, including healthcare and criminal justice expenses, adding to the state’s economic woes.
Alcohol Justice calculates that $4.66 billion in new revenue would be generated over ten years by simply adjusting alcohol taxes for inflation. Another option would be to enact a “Nickel a Drink” increase on beer, wine and spirits that would generate $8.81 billion in new revenue over ten years.